Why legal advice proved costly

In 1992, senior official Bruce Wilson set up the AWU Workplace Reform Association. With no official link to the union, its purpose was supposedly to encourage workplace safety but was actually to fund the election campaigns of union officials. It was eventually revealed that the money was embezzled.

Critical to the operation was Ralph Blewitt, bagman and protege of Mr Wilson. They benefited from the legal assistance of Julia Gillard, then a partner at law firm Slater & Gordon and girlfriend of Mr Wilson. Her advice allowed the slush fund to be incorporated in Western Australia.

In 1993, Mr Wilson - again with the legal advice of Ms Gillard - bought a Fitzroy property in Mr Blewitt's name. This was partly funded by the AWU Workplace Reform Association and a mortgage from Slater & Gordon.

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In 1995 and 1996, both the WA and Victorian police and Slater & Gordon launched investigations into the slush fund. It was alleged that Mr Wilson and Mr Blewitt misappropriated hundreds of thousands of dollars from construction companies.

Ms Gillard left Mr Wilson and resigned from Slater & Gordon, despite being cleared of any wrongdoing. In Victorian Parliament, minister Phil Gude accused her of knowingly helping and benefiting from the slush fund.

The issue would continue to resurface for Ms Gillard. During last year's election campaign, the Coalition promised a judicial inquiry into the scandal. In March, they established the Royal Commission into Trade Union Governance and Corruption.